Estes price increases for 2022

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brockrwood said:
If inflation of the USA stays at 6.8 percent, and the Federal Reseve has to raise its base rate to fight inflation, then rates on savings accounts and similar accounts have to go up
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Basically, banks make money by loaning money at a higher interest rate than the interest rate they pay on deposit accounts. That’s the spread. Let’s say a bank borrows money from the central bank at 1 percent. Then it pays deposit accounts at 1/2 percent. Then it loans out money at 4 percent. The higher the central bank’s rate to loan money to a bank, the higher the bank’s rate on deposit accounts and the higher it’s interest rate on loans made by the bank.
 
OK, my fellow rocketeers and amateur economists, riddle me this:

If inflation increases because the cost of goods and services goes up, then something is driving the increase in prices. In recent months, it is said that tight labor markets, a shortage of workers, and thus the requirement on employers to pay higher wages, is one of the drivers of inflation. It means that employers have to pay workers more just to attract workers, so goods and services cost more.

But then the workers are making more money and can afford higher prices, correct? But that does not seem to be the case. What is the disconnect here? I have no idea, but there must be an explanation.

I think it is energy prices surging by 34 percent more than anything else. That is a huge increase. And it takes energy to make all of the goods and services we enjoy. The cost of energy is fundamental to all other segments of the economy. No energy, no goods. No services. So a huge increase in energy costs should drive up prices, generally, throughout the economy, and drive up inflation, without making the incomes of people who buy goods and services go up at the same time.
 
brockrwood said:
OK, my fellow rocketeers and amateur economists, riddle me this:

If inflation increases because the cost of goods and services goes up, then something is driving the increase in prices. In recent months, it is said that tight labor markets, a shortage of workers, and thus the requirement on employers to pay higher wages, is one of the drivers of inflation. It means that employers have to pay workers more just to attract workers, so goods and services cost more.

But then the workers are making more money and can afford higher prices, correct? But that does not seem to be the case. What is the disconnect here? I have no idea, but there must be an explanation.

I think it is energy prices surging by 34 percent more than anything else. That is a huge increase. And it takes energy to make all of the goods and services we enjoy. The cost of energy is fundamental to all other segments of the economy. No energy, no goods. No services. So a huge increase in energy costs should drive up prices, generally, throughout the economy, and drive up inflation, without making the incomes of people who buy goods and services go up at the same time.
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I'm no expert, but I do know that one huge factor is all the cash that's been printed the last year and a half. The cash supply is very high, so its value is low. Add to that the record low interest rates over the last years, and money is cheap, so it costs more to buy stuff.
 
lcorinth said:
I'm no expert, but I do know that one huge factor is all the cash that's been printed the last year and a half. The cash supply is very high, so its value is low. Add to that the record low interest rates over the last years, and money is cheap, so it costs more to buy stuff.
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I guess if one is a Keynesian economist, one would say that economic stimulus, to get people spending and get the economy going, is always better than the alternative of there not being enough money in circulation so that no one can borrow and no one can invest in the future of the the economy.

Still, the numbers that are now bandied about boggle my mind. Members of congress talk about stimulus programs of TRILLIONS of dollars casually these days. Trillions? Wasn't there a time not too long ago that the entire world economy did not amount to a trillion dollars?

A "1" with 12 zeroes after it. 10 to the 12th power. Wow.

To put that into perspective, there are about a billion stars in the Milky Way galaxy. So a government stimulus program of 1 trillion dollars means that there would be $1,000 in the program assignable to each star in our galaxy.
 
brockrwood said:
OK, my fellow rocketeers and amateur economists, riddle me this:

If inflation increases because the cost of goods and services goes up, then something is driving the increase in prices. In recent months, it is said that tight labor markets, a shortage of workers, and thus the requirement on employers to pay higher wages, is one of the drivers of inflation. It means that employers have to pay workers more just to attract workers, so goods and services cost more.
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No, prices go up because demand > supply. That is not inflation, that is basic economics. Which is corrected as higher prices spur more investment in producing supply.

Inflation happens when the money supply increases faster than the supply of aggregate goods and services.

A little of both is going on. The Fed massively has increased money supply and Covid policies has depressed supply. Fed induced inflation has historically been only corrected by one and only one method...recession.
 
jderimig said:
Then gold would become worthless.......
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Or, the infusion of so much valuable metal into our civilization would lead to some sort of technological breakthrough that would revolutionize how we live fundamentally. Think of it: A huge ball of unimaginable amounts of gold, platinum, nickel, and even good, old iron at our disposal! The super smart nerds of the world would be salivating to get at it and do something fantastic with it.
 
brockrwood said:
Or, the infusion of so much valuable metal into our civilization would lead to some sort of technological breakthrough that would revolutionize how we live fundamentally. Think of it: A huge ball of unimaginable amounts of gold, platinum, nickel, and even good, old iron at our disposal! The super smart nerds of the world would be salivating to get at it and do something fantastic with it.
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Conservation of angular momentum would apply and slow the rotation of the earth and possibly affect the earth's orbit. Possibly leading to a mass extinction event. But we all will have nice shiny (cheap) jewelry.
 
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AeroTech said:
The original Enerjet F67 motors were $5.00 in 1971, and would be $34.31 today based on 51 years of inflation. An AeroTech F25W is $30.99 retail, an Enerjet by AeroTech F67 mid range 'F' is about $18.50 each retail. An AeroTech 'G' motor is priced less than the inflation-adjusted Enerjet 'F' retail price.
View attachment 496748
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Ok, but going back 20 years the retail cost of an H123 was $17.95. It's now $38.99. At the same inflation rate it should be $28.19. The cost of a J350 was $45.95, it's now $81.99. Again with actual inflation in the time period should be $72.16. An H128 and G75 were $11.50 with inflation should be $18.06 and are currently at $29.99. The current prices on the 38mm loads equal around 25% more over the inflation rate. The 29mm. loads are costing us around 37% over the inflation rate. At least once a year I guess we get a break with the Black Friday sales. Too bad the 29mm. motors cost that much more, they are very popular loads, oh wait I guess that explains it.

Just say' in, cause it was brought up. Motors are high price no matter who the manufacturer. It's the nature of the hobby, I'm 66 ready to retire from the hobby and even spending 30-40 bucks on a small H that is gone in a second or two is getting harder to do for me. It's not because I can't afford it, it's because I don't want to burn my money that fast anymore. The ratio of the cost of motors to income has gone way up compared to 20 years ago.
 
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rcktnut said:
Ok, but going back 20 years the retail cost of an H123 was $17.95. It's now $38.99. At the same inflation rate it should be $28.19. The cost of a J350 was $45.95, it's now $81.99. Again with actual inflation in the time period should be $72.16. An H128 and G75 were $11.50 with inflation should be $18.06 and are currently at $29.99. The current prices on the 38mm loads equal around 25% more over the inflation rate. The 29mm. loads are costing us around 37% over the inflation rate. At least once a year I guess we get a break with the Black Friday sales. Too bad the 29mm. motors cost that much more, they are very popular loads, oh wait I guess that explains it.
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Yes, but there are reasons why some product price increases may not seem to follow the inflation rate, especially over a relatively short time span. 51 years for the Enerjet example is a long time and tends to even out the anomalies. 20 years, not so much. For example, it could be that some products were priced too low to begin with. Also, some commodities used in manufacturing the products have increased in price far above inflation rates. Take AP for example, our cost for AP basically more than tripled virtually overnight. The paper tubes used in motors and reloads also increased significantly above inflation, especially after our supplier got acquired by another company. Those are just two examples and there are many more. Often a company shoots for a certain average gross profit margin on their P&L so that it can afford to pay for the fixed overhead expenses. Some products may have a smaller gross margin than others due to market and competitive factors. So products with higher margins can offset the lower ones. It is a rather complex and delicate process to effectively run a business so that it can continue in operation successfully and indefinitely.
 
AeroTech said:
Yes, but there are reasons why some product price increases may not seem to follow the inflation rate, especially over a relatively short time span. 51 years for the Enerjet example is a long time and tends to even out the anomalies. 20 years, not so much. For example, it could be that some products were priced too low to begin with. Also, some commodities used in manufacturing the products have increased in price far above inflation rates. Take AP for example, our cost for AP basically more than tripled virtually overnight. The paper tubes used in motors and reloads also increased significantly above inflation, especially after our supplier got acquired by another company. Those are just two examples and there are many more. Often a company shoots for a certain average gross profit margin on their P&L so that it can afford to pay for the fixed overhead expenses. Some products may have a smaller gross margin than others due to market and competitive factors. So products with higher margins can offset the lower ones. It is a rather complex and delicate process to effectively run a business so that it can continue in operation successfully and indefinitely.
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I understand that 100%. (except for the difference between 29mm and 38mm) The problem is that the average American Blue Collar BAR- Rocketeer Joe's wages don't match up with all the increases, which of course is the norm for everything we purchase. Our club always tries to promote the hobby we had displays at Rockets for Schools and model aircraft events, had sign up sheets, all is well, lots of enthusiasm until they ask what the motors cost. I was adding to my post when you posted, like I said it's the nature of the hobby, but motor cost to income ratio compared to 20 years ago is way higher.

BTW, in the 25 years I've been flying it has been 99% Aerotech motors.

motors 1.JPGLARS Display 2.JPG
 
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I shudder to think what prices would be if we haven't shifted 90% of consumer goods production to slave labor countries.
 
Initiator001 said:
The Estes website ( https://estesrockets.com/ ) has been updated with new pricing on all the products.

While I have not reviewed every item, it appears there has been a ten percent increase in Suggested Retail Price (SRP).

Several of the on-line vendors (AC Supply for one) have already raised their prices.
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Partly due to supply chain issues of not getting enough base product to assemble into kits. I also wonder how the closing of the Goex black powder plant is having on Estes sourcing for their engines.
 
TigerHawk said:
I read another post about that somewhere not to long ago and it said that Estes gets their BP from Canada, I believe.
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Interesting, I'd like to know more about that since there are no BP factories in Canada. Maybe import through Canada from Swiss?

Something very interesting is that I found a BP dealer in Canada (about 3 hr drive from me in my own Province!) I shall have to investigate further...
 
prfesser said:
No. Or at least unlikely. The oxidizer used in Pyrodex is far more sensitive to pressure changes than the one in BP. Nozzles for motors of Estes size probably couldn't be made with enough reproducibility in operation.
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Hmm. Maybe it is time for even low power rocket motors to be composite motors? The thrust curves are different from black powder, no?
Are all composite rocket motors filled with ammonium perchlorate?
 
Rory Gin said:
Interesting, I'd like to know more about that since there are no BP factories in Canada. Maybe import through Canada from Swiss?

Something very interesting is that I found a BP dealer in Canada (about 3 hr drive from me in my own Province!) I shall have to investigate further...
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It’s a post from YORF back in September,
Initiator001
Initiator001 is offline

Too Many Initiators is Never Enough		 Join Date: Mar 2005
Location: San Diego, CA
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Default

Quote:
Originally Posted by Earl
Anyone have any idea where Estes procures their BP and how the closure of this plant might affect their motor production, if it will at all?

Earl

I vaguely recall hearing years ago that Estes now gets black powder from Canada.
 
Rory Gin said:
Partly due to supply chain issues of not getting enough base product to assemble into kits. I also wonder how the closing of the Goex black powder plant is having on Estes sourcing for their engines.
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Black powder seems simple (if dangerous) to make. Sulfur, saltpeter, and charcoal. It seems like somebody would start making black powder to satisfy demand if Goex stops making it.
 

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